Economy - overview:
Since formal independence from Ethiopia in 1993, Eritrea has faced many economic problems, including lack of resources and chronic drought, which have been exacerbated by restrictive economic policies. Eritrea has a command economy under the control of the sole political party, the People's Front for Democracy and Justice (PFDJ). Like the economies of many African nations, a large share of the population - nearly 80% - is engaged in subsistence agriculture, but the sector only produces a small share of the country's total output. Since the conclusion of the Ethiopian-Eritrea war in 2000, the government has expanded use of military and party-owned businesses to complete President ISAIAS's development agenda. The government has strictly controled the use of foreign currency by limiting access and availability; new regulations in 2013 have slightly relaxed currently controls. Few large private enterprises exist in Eritrea and most operate in conjunction with government partners, including a number of large international mining ventures that have recently begun production. While reliable statistics on food security are difficult to obtain, erratic rainfall and the percentage of the labor force tied up in national service continue to interfere with agricultural production and economic development. Eritrea's harvests generally cannot meet the food needs of the country without supplemental grain purchases. Copper, potash, and gold production is likely to drive economic growth over the next few years, but military spending will continue to compete with development and investment plans. Eritrea's economic future will depend on market reform, international sanctions, global food prices, and success at addressing social problems such as illiteracy and low skills.

NOTE: The information regarding Eritrea on this page is re-published from the 2016 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Eritrea Economy 2016 information contained here. All suggestions for corrections of any errors about Eritrea Economy 2016 should be addressed to the CIA.

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